Disclosure Best Practices (Prototype)
Wednesday, February 7, 2018 at 06:26PM
Charlie in Creating Investor Friendly SEC XBRL Filings, Digital Financial Reporting

I have perfected what I call a Disclosure Best Practices resource. I am envisioning this as a resource for intermediate accounting students to begin with. Then it could be expanded and made useful to professional accountants that external create financial reports.

This early prototype which took the form of a document helps you understand where this Disclosure Best Practice resource is going. The conceptual model of a financial report also helps you understand this resource.

There are two important things that might not be apparent by just looking at this resource.  First, the information you see is 100% machine readable as well as being readable by humans.  Second, the organization of the information into the form you see is 100% automated. That organization is achieved using metadata from the conceptual model.

If you don't understand this Disclosures Best Practices resource or why it is important, you should consider reading the document Closing the Skills Gap.

The foundation for this Disclosures Best Practices is the Reporting Checklist and Disclosure Mechanics machine-readable business rules.  Validation is run to make sure you only get examples that are of high quality.  So for example, here is the validation of the Microsoft 10-K.  Imagine that same information for (a) all public companies that report to the SEC and (b) reading the information using automated machine-based processes rather than reading the information in a web browser.

Stay tuned for more information.  If you want to keep on top of all this, participate in the campaign to improve disclosure quality.  By March 31, 2018 the 65 disclosures of the campaign and the disclosures in the Disclosure Best Practices resource should be in sync.  Then; I will start adding more disclosures to expand the set available.

Be sure you fiddle with the prototype.  There is more there than you might recognize by just glancing at it.  This is the primary entry point into the resource.  There are about 50 different disclosures.  You can see information about each of the some 50 disclosure. You can get information about economic entities that create the reports.  Information is linked to US GAAP XBRL Taxonomy information and the Accounting Standards Codification.  Topics which will enhance filtering and searching for disclosures will be incorporated. More metadata exists to filter reporting entities by reporting style, by accounting activity, by sector, by size of the company, and other such information is incorporated, but is not apparent yet.

One next step for me is to create this same resource for the XASB reporting scheme. The reason for that is to show that the conceptual model is not specific to US GAAP or even IFRS; it is general. Ultimately, it will work for all of these profiles.

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Article originally appeared on Intelligent XBRL-based structured digital financial reporting using US GAAP and IFRS (http://xbrl.squarespace.com/).
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